July 2013 Health Care Reform

July 2013 Health Care Reform

In a surprise, The Treasury announced on July 2nd that the employer mandate of the ACA will be delayed until January 1, 2015.

What does this mean for employers? For 50+ employers, the reporting and penalty provisions of the mandate, “Pay or Play”, will take effect in 2015 and will not apply for 2014.

The delay only applies to the mandate, the other provisions of the law remain in effect, and the exchanges, or health insurance marketplaces, are still scheduled to open on October 1, 2013 for January 1, 2014 effective dates. We have received two updated notices and we have posted these on our blog.

The ruling also raises questions such as how are officials that are running the exchanges going to know who will qualify for a subsidy. With this new ruling, employers will not be required to report information on the coverage and affordability provisions that their plans are compliant. We will wait for further guidance on this issue and others that this delay brings and will bring them to you as we learn more.

Why did the announcement come from Treasury and not the IRS or HHS? The reporting requirements and enforcement fall under the Treasury Department. The ruling was announced on a blog post by Mark J. Mazur, assistant secretary for tax policy, which we have included the link to his post on our blog. In his post, Mr. Mazur wrote that the Treasury Department will issue official guidance to insurers, self-insuring parties and other parties that provide health insurance within the next week and formal rules will be proposed later this summer.

Even though the Mandate was delayed, employers still need to be focused on preparing for Reform and the Employer Mandate. This ruling does give us more time to prepare, test systems, and make sure our compliance plans are sufficient. If you have any questions please consult your Clarke & Company Benefits or McLaughlin Smoak & Clarke Benefits representative. We will continue to update our readers on this delay as we learn more from all the agencies that are involved with rules, regulations, and enforcement.